More Private Investors Lose Interest in Seagate - Rumours

From X-bit Labs: The interest of private investors towards Seagate Technology is getting lower as more firms withdraw from negotiations. Apparently, private equity firms are not too interested in acquiring the world's second largest maker of hard disk drives (HDDs) and then improve its competitive position as well as cost structure.

The first company to withdraw from negotiations to take over Seagate was Silver Lake Investment. Recently Kohlberg Kravis Roberts & Company (KKR) also lost interest in acquiring Seagate and the interest of Bain Capital is also declining, reports Reuters news-agency. At present only TGP Capital (Texas Pacific Group) shows interest in taking over the well-known maker of hard drives.

As TPG had been trying to find equity partners, the privatization of Seagate could still materialize, the agency noted.

The reasons why Seagate wants to become a private company once again remain unclear. In the year 2000 the company was undergoing a huge reorganization and actually needed financial support and stability. At present Seagate executes more or less efficiently, even though its stock has been decreasing since January, 2010, mostly due to overall business conditions. On the other hand, it may be a good time for another reorganization of Seagate as the company is undervalued for certain reasons. In the coming years the company will face majorly changing world, where solid-state drives and cloud services will play more and more important roles. Overall, the timing is good for another tangible reshape and in order to that the company needs to free the hands of executives and get rid of necessity to increase the stock price all the time.

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